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A lumber company just recently issued two different bonds, L and M. Bond L has a three year term and Bond M has an 18
A lumber company just recently issued two different bonds, L and M. Bond L has a three year term and Bond M has an 18 year term. Both bonds initially sell at par. Soon after issuing these bonds, the market interest rate increases substantially. What are the new relative prices of Bond L and Bond M ? Price Bond M> Price Bond L$1000 Price Bond M= Price Bond L=$1000 Smitty bought a 12% bond several years ago for $1050. Currently the bond sells for $1,278 and has 10 years to maturity. What do you know about the current yield to maturity of the bond, and how have interest rates changed since Smitty bought the bond? YTM 12%, rates have increased YTM12%, rates have decreased HighTOPX projects that total sales will be higher next year, but that all the additional sales will be credit sales (cash sales will stay the same). All else equal, what will happen to operating cash flow (OCF), net working capital (NWC), and net cash flow (NCF) for in the next year? OCF increases, NWC increases, NCF unchanged OCF decreases, NWC decreases, NCF unchanged OCF increases, NWC decreases, NCF increases OCF decreases, NWC increases, NCF decreases
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